Friday, April 10, 2009

TOP STORY >> Settlement will burden tight budget

Sherwood officials are scrambling to find the money to pay a settlement with the city’s former ambulance provider that they had fired — a lawsuit that they think they should have won.

“I don’t think any of us wanted to do it. I didn’t want to do it, but I didn’t see any other option,” said Alderman Sheila Sulcer after the Sherwood City Council voted Wednesday afternoon to settle a lawsuit brought against the city by Arkansas Emergency Transport.

The 5-1 vote to settle will cost $350,000. The city’s insurance company, which has already paid out $125,000 in attorney’s fees to fight the suit, will pay $125,000 toward the total settlement, leaving the city with $225,000.

The unbudgeted expense is on top of the recent agreement to buy the old North Hills Golf Course for $5.5 million, the $1 million or more it will cost to turn the acreage back into an operating golf course as many on the council want to do, the $2 million to $5 million needed to bring the city’s sewer system into compliance, and the untold expense the city may face if it loses or settles a recently filed lawsuit by a developer over the North Belt.

Even though the council voted to accept the settlement, it did not approve an ordinance allocating the money as it didn’t have the six required votes.

Aldermen Charlie Harmon, Kevin Lilly, Becki Vassar, Marina Brooks and Sulcer voted for the settlement. Alderman Butch Davis was against it and Ken Rankin and Steve Fender were not at the hastily called meeting.

Mayor Virginia Hillman was also against settling.

Arkansas Emergency Transport, claimed Sherwood violated terms of the contract when it fired AET. Sherwood fired the company in the fall of 2006 because it believed AET was negligent and incompetent.

Among the city’s complaints when it fired AET and hired Metropolitan Emergency Medical Service was an incident where an AET ambulance went to the wrong school because the driver didn’t know the area and that delay turned out to be a factor in a teen’s death.

MEMS took over in October 2006 and the city signed a five- year agreement with that service in December 2006.

AET was let go just a year and a half into a five-year contract and claimed in its suit that it was owed more than $750,000, plus attorney fees.

Earlier this week, U.S. District Judge Susan Weber Wright issued a directed verdict for the ambulance suit agreeing that the city had violated the terms of the contract. A jury was only going to get to decide on the monetary award.

“I still think if the jury heard about the problems we had with AET it would have sided with us, and the monetary amount would have been small,” the mayor said.

But five attorneys who worked for the city on this case all agreed that it was too risky and asked the council to settle.Sulcer said there was a lot of “long and hard discussions” at the 90-minute council meeting.

Sulcer felt the decision by the judge was unfair. “I’m not an attorney, but I don’t think it was right that only the contract was looked at and not what AET was actually doing in the city. AET didn’t live up to what they said they would do,” Sulcer said.

“I hate that we had to do this,” Vassar said.

“No one disputes that fact that we had to make the change. When we made the change it was in the best interest and safety of our residents,” Vassar explained.

In voting for the settlement, Vassar said it was the lesser of two evils. “It was not palatable, not pleasing, but safer than taking it to the jury,” she said.

When the case was first filed, Vassar thought the city had a slam-dunk win because of all the incidents of poor service by the ambulance service.

She even called some of those incidents nightmarish. But when the judge decided not to look at that, Vassar felt it put the city in a corner. “I’m just heartsick about this.”

The mayor said the council will have to meet again to officially appropriate the money. She said she had not heard anything from the city attorney or court as to whether it must be a lump sum payment or can be paid over time or when any payments have to be made.

“We just weren’t pleased and felt they weren’t providing for the safety of our citizens,” said Bill Harmon, mayor at the time. Under the new contract, MEMS promised to have at least two ambulances on call in the Sherwood area at all times. “Once that second ambulance is called out, we’ll roll a third one into the area, and then a fourth and so on, if necessary,” Jon Swanson, executive director for MEMS, told the council in December 2006.

The council has been very pleased with the efforts and response and work of MEMS since they took over.